Foreign businesses explore products introduced by Tuong Long Company at the exhibition. Photo: N.H

Opportunities from innovation and sustainability

Speaking at the 6th Denimsandjeans Exhibition recently held in Ho Chi Minh City, Mr. Sandeep Agarwal, founder of Denimandjeans.com, noted that in 2016, Vietnam's denim sector was just beginning to develop. However, despite a nearly three-year impact from the pandemic, the denim industry in Vietnam has grown remarkably in just eight years. This growth is evident in the increase in exports and the influx of new buyers to Vietnam. Orders to Vietnam vary greatly, from high-end to more basic ones. “This demonstrates the industry's depth and its ability to serve a wide range of needs,” Mr. Sandeep Agarwal remarked. The 6th Denimsandjeans Exhibition used the theme "Room to Roam" to focus on consumers shifting their attention to more comfortable and relaxed denim clothing, implying that there is still "a lot of room" for innovation and sustainability in denim.

The Denimsandjeans exhibition took place over two days, June 26-27, at Riverside Palace, District 4, Ho Chi Minh City. The event gathered 36 leading denim businesses from 10 countries, including 10 Vietnamese companies specializing in supplying fabrics, chemicals, technology, and accessories in the denim industry.

Nguyen Thi Tuyet Mai, Deputy Secretary General of the Vietnam Textile and Apparel Association (VITAS), informed that Vietnam has participated in a series of bilateral and multilateral free trade agreements (FTAs) with most economies around the world, 16 of which have come into effect. These FTAs create numerous opportunities to attract foreign investment into the missing parts of Vietnam's textile and garment industry, as well as opportunities for cooperation with textile enterprises in general and denim in particular.

Vietnam is currently among the top three textile exporters globally, with total export turnover in 2023 reaching over US$40.3 billion. The textile export turnover in the first five months of 2024 is estimated at about US$15.8 billion, an increase of approximately 4.7% compared to the same period in 2023.

However, according to Mai, although Vietnam's textile and garment industry has developed rapidly, it remains unbalanced. Currently, 80% of the products produced are for export, and only 20% are for domestic consumption. Vietnam's textile industry also faces limitations in domestic raw materials and bottlenecks in fabric production. Therefore, Vietnam continues to call for investment in weaving, dyeing, and finishing fabrics, including denim, to gradually provide sufficient raw materials for the textile industry and implement the strategy for developing Vietnam's textile and garment industry in the near future.

Many new product models were introduced at the exhibition attracting the attention of visitors. Photo: N.H

On a growth trajectory

Vietnam has exported more than 65-70 million denim garments annually, and this number is expected to increase by 2024, with many large orders and capital flows taking advantage of the EVFTA. Nguyen Thanh Tiep, Business Director of Viet Hong Textile Dyeing Joint Venture Company, which specializes in supplying denim fabrics to brands in the US, Japan, Korea, and the EU, said that after a quiet period, the denim market has revived since the Lunar New Year 2024, with increased production from US brands. Particularly in Q2/2024, orders have surged. The company is currently operating at 100% capacity and has received about 50% of the orders for August.

According to Tiep, Viet Hong aims for an export revenue of US$17 million in 2024. So far, the revenue has reached about 55% of the annual target, up more than 30% compared to the same period in 2023. Therefore, Tiep sees considerable growth potential for the denim industry in the coming period.

Pham Minh Dat, head of the international business department at Tuong Long Textile Co., Ltd., also shared that with the market's improvement in the first six months of 2024, the company recorded a growth of about 25% compared to the same period last year and has received sufficient orders until September 2024.

With a positive outlook for the coming years, Tuong Long is expanding its factory to increase capacity from 2 million meters/month to 2.5-3 million meters/month. The new production facility is expected to be operational next month.

Dat added that when orders from China shift to Vietnam, brands offer prices equivalent to the Chinese market, posing challenges for Vietnamese businesses. However, with serious quality investments, after negotiations and sample submissions, brands have accepted the prices proposed by the businesses.

At this year's Denimsandjeans exhibition, Vietnamese companies showcased many new sustainable and eco-friendly products, such as denim fabrics made from recycled fibers, bamboo fibers, coffee fibers, and hemp fibers. Additionally, companies are focusing on lightweight, thin denim fabrics that provide comfort, suitable for daily consumer use.

Moreover, aside from investing in product quality, businesses are also striving to innovate production technologies to protect the environment, such as using renewable energy and switching from coal-fired boilers to electric and environmentally friendly fuels.